Donald Trump Tries Breaking US’s Reliance on China’s Critical Minerals

The White House issued a statement that in order to boycott China's acquisition of US technology, The US “will impose a 25 % tariff on $50 billion of goods imported from China containing industrially significant technology, including those related to ‘Made in China 2025’,” the White House said, referring to the Chinese government’s policy to support domestic development of strategic technologies. The list of specific commodities was then announced on June 15, and tariffs will be implemented shortly thereafter.

What is the outcome of the China-US trade war negotiations is still unknown. US Treasury Secretary Mnuchin said clearly that the United States and China have made very meaningful progress, and the two countries reached an agreement on the framework and agreed to stop the trade war. Why did Trump suddenly change his mind then? The reason is that China's development has made the world's first developed countries feel threaten, and try to suppress China. Not only has the United States regarded China as its main competitor. So does Germany. Right after German President Merkel returned from his visit in China, She held an AI Summit, which aimed to formulate a new AI strategy to compete with China.

In the present, the strategic metal resources are compulsory for the development of science and technology in any countries. In particular, with the rapid development of Materials Science, countries have tried to ensure the control over the exploitation and development of rare metals. Rare metals are truly rare. A metal is defined as if it satisfies one of the three conditions: very rare in the earth's crust, production area is concentrated in a specific area, difficulties in separation and refining. Tungsten is sure to be a rare metal as it satisfies the second condition. Most of the tungsten mines are in China, and about 60%-64% of the world's tungsten reserve locates in China. At present, 90,000 tons of WO3 have been drilled in China every year, which supplies about 80% of the world's tungsten demand. At the same time, tungsten is also a strategic metal. It is mainly used in military, aerospace, automotive, petrochemical, microelectronics and new materials industries. At present, most of the world's tungsten supply is relied on China’s supply, especially the United States.

The United States has 4% of the world's tungsten reserve. It is needed to know that Donald Trump is not just a crazy man but also a fickle mean people. The purpose of his trade war is to suppress China's high-tech industry. But the US high-tech industry relies on China's critical resources such as rare earths, tungsten, indium and other minerals. In order to break the reliance on these critical minerals resource, Trump listed 35 important minerals against China and Russia, encouraging US companies to exploit critical minerals (North America, South America, Australia are abundant in mineral reserves). Tungsten is among the list as well.

Recently, Thor Mining PLC, which operates the Pilot Mountain tungsten mines in Nevada, USA, said that thanks to Trump's list, the company's share price has raised. Currently, they own 100% of the resources of the Pilot Mountain project in Nevada, which includes copper, silver and lithium in addition to tungsten. As the tungsten price in the world market is rising, they are fully accelerating the preparation for exploration and mining, and the date of production is expected to be coming soon.

Americans believe that the Pilot Mountain project has a unique strategic position. It is a national project with long-term mining jurisdiction, which is conducive to the safe operation of the United States. The project will provide more employments, meet the country's demand for tungsten, and help stimulate America’s market.

In summary, to prevent China from restricting the strategic minerals such as tungsten and rare earths, Donald Trump tries to break US’s reliance on China’s critical minerals.

• < Prev
• Next >